Criminal organization and drug traffickers are increasingly using prepaid cards, or prepaid access devices, rather than cash for illegal transactions in attempts to reduce the risk of loss from theft and law enforcement intervention. Laws currently require that travelers entering and leaving the United States declare when the aggregated value of cash and other monetary instruments exceed a value of ten thousand dollars. Proposed legislation would also require that prepaid cards and other prepaid access devices be included in such declarations. Law enforcement frequently seizes cash and prepaid access devices when discovered as undeclared and being brought into and taken out of the country, as well as during arrests and drug seizures. However, law enforcement does not currently have the equipment nor the methodology to determine the values of balances for the seized prepaid access devices, nor to freeze and subsequently seize the funds held in accounts associated with the prepaid access devices.
The balances on associated account for seized prepaid access devices may quickly be drawn down by criminals prior to law enforcement seizure if funds in the associated accounts are not quickly seized, or quickly frozen for later claiming. Technology advances can allow the value balances from prepaid access devices to be moved in seconds from one to another, anywhere in the world with use of mobile devices, creating exigent circumstances which require prompt action. Law enforcement may also have difficulty in identifying prepaid access devices, such as which may occur when the information contained on a magnetic strip of a branded prepaid access device may be stripped off of open loop branded cards or closed loop cards and moved onto nondescript cards, such as a non-embossed card of paper or plastic having a magnetic stripe which are often used for hotel room keys. Equipment and a methodology are required for law enforcement officers to quickly determine whether machine readable devices are encoded with prepaid access data, and if so, to quickly determine the value of the balance associated with the prepaid access devices and to quickly freeze or seize the associated balance.
The Financial Crimes Enforcement Network (“FinCEN”), a bureau of the U.S. Department of Treasury, is tasked under the Bank Secrecy Act with monitoring monetary transfers of large sums of money. FinCEN is currently proposing amendments to the Bank Secrecy Act which would require that prepaid access devices be included in declarations required when aggregate values of cash and monetary instruments exceed a prescribed amount, currently ten thousand dollars. The legislation proposed by FinCEN defines prepaid access devices as any open or closed loop prepaid access account and or device, regardless of technology, including, but not limited to, plastic cards with magnetic stripes, plastic cards with chip-n-pin or near field communications devices embedded into a form factor to facilitate use of the prepaid access account. As used herein, prepaid access devices shall include the definition set forth above by FinCEN, and further include machine readable devices on which prepaid account data may be imprinted, embossed or encoded, including devices with readable magnetic strips, and other encoded electronics, such as those read by direct electrical contact connections, optical imaging, and near field communications (“NFC”) devices, such as RFID chips.